This is a civil claim which the law says that retailers can pursue against people they catch stealing from their establishment. It is separate and apart from criminal charges. This letter is coming to you from the corporate office.
Whether or not you will be charged depends on what happened. If you are a juvenile, it could be that the store is providing the information to law enforcement to pursue a juvenile charge against you, rather than arrest you at the scene. This is particularly true if you are quite young.
However, it could be that nothing criminal will happen and they are still pursuing civil damages. I have seen this occur in other cases.
What did they tell you at the time that you were caught?
You're pretty lucky they didn't call the police! However, just because you weren't arrested doesn't mean you can't be charged later. It is possible that Urban Outfitters could make a police report and you could be charged anytime in the next year. I think this is pretty unlikely, though. Even if a police report is filed it's most likely that your case would be referred to what's called a "community diversion board," which will order you to do some stuff (maybe a class about shoplifting or some community service) to avoid being prosecuted. As far as a record goes, there will only be a record at all if the police are called. Unless you are prosecuted and convicted, the only place this record would come up is law enforcement databases, meaning it only matters if you get in trouble again.
As for the letter, there are several companies that send this kind of letter out to shoplifters and/or their parents. People tend to pay because they're afraid not to. I'd never recommend that you not pay and risk a civil suit, but I've never seen a civil suit brought by one of these companies against a shoplifter.